Apple begins laying off third-party contractors as a cost cutting measure

Apple has been the only Big Tech Company that has avoided mass layoffs to date. But now, according to reports, the company has reportedly started laying off third-party contractors.

The latest report that cites people with direct knowledge, says that the iPhone maker has started to cut ties with hundreds of contractors quietly. Instead of waiting for contracts that are typically renewed every 12 to 15 months to expire, Apple is firing contractors outright, the report said. According to the report, firing contractors is a move to cut costs.

The company hasn't disclosed the size of its contractor workforce, but reports suggest the number is in the thousands. Apple CEO Tim Cook had called layoffs at the company a "last resort kind of thing", adding that "You can never say never".

"We want to manage costs in other ways to the degree that we can," he was quoted as saying.

As China faced Covid surge, Apple faced supply chain disruptions in October and November with protests erupting at its key supplier Foxconn's main factory in the country. Cook said that Covid-related challenges "significantly impacted the supply of iPhone 14 Pro and iPhone 14 Pro Max and lasted through most of December".

As a result of a challenging environment, "our revenue was down 5 per cent year over year", he added.

Apple's employee count went up by about 7 per cent in 2022 as compared to 2021. Cook has already taken a huge pay cut of $35 million, or more than 40 per cent of his compensation.